OCI Reports Volume Growth Across All Businesses, Iowa Fertilizer Company in Final Stages of Commissioning
Highlights for H1 2016:
Statement from the Chief Executive Officer – Nassef Sawiris:
“I am pleased with the strong growth in our product volumes this year, in particular as all our operations contributed. We expect to continue this path of growth. Our greenfield initiatives are on track to boost our current production capacity by 50% by end-2017: IFCO is now in commissioning phase and start of production is imminent, and Natgasoline is making excellent progress to start production next year. We also expect further improvements in gas supply in Egypt and higher utilization rates in Algeria following a turnaround of the facility.
Fertilizer prices are currently at what we believe are unsustainably low levels. Not only are prices below break-even costs of many producers, mostly in China, the supply-demand balance is expected to tighten as global supply additions start declining significantly from the second half of 2017. As one of the lowest-cost producers globally, strategically located near some of the largest end markets for fertilizers in Europe and the US Midwest, OCI is well-placed to benefit from improvements in underlying markets. Methanol prices already started improving in recent months and demand remains strong, supporting a promising outlook for our methanol operations.”
Statement from the Chief Financial Officer – Salman Butt:
“In the last six months, we have made significant progress in strengthening our balance sheet by raising cash proceeds in excess of $1.3 billion through refinancing of OCI Nitrogen and monetizing our shareholder’s loans to Natgasoline. These funds have been utilized to settle all due short-term obligations and provide all remaining financing for IFCo. With the expected completion of IFCo in Q4 2016, Natgasoline already fully funded and no plans to initiate new projects over the next 18 to 24 months, we have no further financing requirements for growth capex. Starting 2017, we expect to enter a phase of consolidation, where all operational cash flows from the step-up in product volumes will be used to deleverage the balance sheet. We may also seek disposal of non-core assets and / or seek partnerships in certain stakes to accelerate the strengthening of our balance sheet, with the objective to achieve investment grade ratings by 2018 / 2019.”
An investors and analysts conference call will be hosted on Tuesday 6th September at 5:30 PM CET (4:30 PM BST, 11:30 AM EDT) by Nassef Sawiris, Chief Executive Officer, and Salman Butt, Chief Financial Officer.
The dial-in numbers for the conference call are:
Standard International: +44 (0) 1452 555566
United Kingdom FreeCall: 0800 6940257
Netherlands FreeCall: 08000 235 091
United States FreeCall: 1 (866) 966 9439
Conference ID: 76660408
A conference call replay will be available following from 20:00 BST Tuesday 6th September until 4th October 2016.
The replay access numbers are:
Standard International: +44 (0) 1452 550 000
Netherlands: 08000 234 610
United States: 1 (866) 247 4222
Conference ID: 76660408